Senator KROGER (12:30 PM)
—It is challenging to rise and speak on the Carbon Pollution Reduction Scheme Bill 2009 [No. 2] and related bills at this time—timing arising from the government having brought on these bills in this chamber now while good faith negotiations are taking place between the Minister for Climate Change and Water, Senator Wong, and the Hon. Ian Macfarlane to consider significant concerns that the coalition parties have. We are concerned that this legislation does not provide adequate protection for the economic security of this country. In so doing, it does not protect jobs and provide economic certainty for all Australians.

Notwithstanding the timing of this second reading debate, I do rise to join this critically important discussion on an issue that has polarised the nation. The Prime Minister is intent on attending Copenhagen with an Australian policy. He seeks to position himself as a world leader on climate change. Such is the effrontery of the man, he believes that Australia, whilst ranked the 14th largest economy in the world and the 15th most competitive nation, according to the World Economic Forum, will be able to influence the direction of the United States, the EU, China and even India. What a joke that assumption is predicated upon. This is the prime minister who has so badly handled the policy of border security protection that he has seriously threatened Australia’s important relationship with Indonesia. In the last few weeks, we have witnessed unprecedented ineptitude in handling the flood of asylum seekers to Australia. We have been told that an agreement was made with President Yudhoyono when obviously discussions that took place were not as definitive as the Prime Minister inferred they were. The Prime Minister stood in the other place and said that no special deals had been made when clearly special deals had been made. Such is the concern of the Indonesian government that the Indonesian President’s personal visit has been indefinitely postponed. Whilst the Australian people are still waiting for full disclosure, it is clear that there is now increasing tension between the two countries.

Sadly, this reminds me of the influence that Mr Rudd has had on our diminishing relationship with China. From the moment that Mr Rudd chose to lecture Chinese students in Beijing on human rights issues in China to the recall of the Australian ambassador for a meeting on 20 August, our relationship with China has been fraught. It is abundantly clear that Mr Rudd should focus on the daily challenges of Australians rather than walking the world stage continuously looking for photo opportunities, yet that is what he is seeking to do in Copenhagen in December through this bill.

The consideration of this bill should not be influenced by the Prime Minister’s determination to attend it with a finite commitment from Australia regardless of whatever any other country might agree to do. Notwithstanding my grave reservations about his motives, and while we are engaged in the second reading debate at this time, I join the debate to give voice to the many concerns that have been raised with me not only up here but by many of those back in Victoria. When I spoke against the Carbon Pollution Reduction Scheme Bill 2009 and cognate bills on 12 August, I did so because the proposal is a flawed scheme that has no regard for the protection of Australian businesses and industry. This bill, in its current form, is a scheme that would harm Australian exports, jobs and investment. Industry after industry has sought discussions with the coalition and asked us to negotiate amendments so that this bill can be improved. In its current form, the bill will simply destroy viable local business and, in effect, export business and the related emissions overseas.

Without an understanding of what other countries will do, to be the first country off the block not only is premature but smacks of not having one’s own country’s interests at heart. We have no real full appreciation of the fiscal impact of this scheme and the modelling that has been presented is limited at best. Despite the inherent weaknesses in what the government has sought to do here, I strongly support the negotiations that are taking place to ensure that this bill is finally presented here with Australia’s economic surety as a primary consideration. This is too critical to muck up. Our economy has contracted, as we know, during the last 12 months and, as we also know from experience and history, it is at such times that carbon emissions also contract due to lesser industrial activity, regardless of whether we have an ETS or not. An emissions trading scheme must take into account what is happening in other countries or the scheme will be doomed from day one and certainly will not be giving the considerations of all Australians the No. 1 priority they deserve.

The Liberal Party support the Copenhagen process. We also support the fact that we want to join in the collaborative discussions to achieve the best collective outcome. However, we do not support the design of this current scheme and the unnecessary rush to implement it. I have to say, the fact that we debated this in August and it is now back before the chamber smacks of questionable political expediency. There seems to be uppermost a political agenda on the table in this second reading debate. If we come back here after Copenhagen, we could have a more informed debate. Action on climate change is wanted by many. It is a message that many of us are hearing loud and clear. I am not opposed to emissions trading in general, as the government continually suggests so many of us on this side of the chamber are meant to be. I simply do not believe that this is the only tool in the box that can be used to act on climate change. Carbon trading is not the only answer.

The Liberal Party believe in individualism not collectivism. We know, accept and appreciate that individuals have different opinions. When it comes to climate change there are indeed many viewpoints in this party, views which do not necessarily match the zealotry of the black and white approach of those on the other side of the chamber. We enjoy and are very lucky to be in a party that supports democratic principles, where we all have the capacity to share and express our individual views. It is something we all strongly support and it is one of the reasons that we joined the Liberal Party. I have great respect for the views expressed on this side of the chamber because it is those differing views that we applaud in the Liberal Party. Under the Howard government, the coalition provided stronger governance of this country through a diversity of views that led to the policy development at that time.

We need to take a step back from this overheated debate and talk honestly about what we can realistically achieve together. This is a position that more and more Australians agree with. We have read about the shift in perceptions in the newspapers. I am talking about those who share everyday concerns for their families, who still want to have a job and be employed so that they can support their families, who want to give their kids every opportunity in life and who want to provide for their education and health. We do not want to stymie the opportunities for all Australians. We have to make sure that we protect their interests in whatever is decided in this place. We have seen a shift in perceptions, as evidenced through the various Newspoll results.

Interestingly, the Senate Select Committee on Climate Policy came to a very similar conclusion. In their majority report, the committee urged the Rudd Labor government to go back to the drawing board. They said that Treasury should model the short-term costs of the scheme, the effect on jobs and in particular on regional Australia, and the comparative costs of a raft of vastly different ways of imposing a carbon price. This is a recommendation that I fully support.

Why do we need to be pushing this through right now? These questions have not been responded to by Minister Wong. Perhaps the answer is a simple one. Current estimates say that the CPRS will impose costs on electricity and other energy-intensive industries. This could easily lead to a 30 to 40 per cent increase in power bills and indirectly increase prices for most services and items purchased. Yet, from a political point of view, it is far less troublesome to impose what essentially will amount to a carbon tax for all consumers and introduce an ETS than another instrument. As politicians, we all know that any taxes are very unpopular. But it will not just be the big polluters that will have to pay the price for an ETS; it, of course, will be households—the consumers, the mums and dads.

The unrealistic assumptions about the world’s action on climate change and the Rudd Labor government’s approach to this have demonstrated that they have not done their homework when designing the CPRS. There has been very little modelling done on this. There has been no suggestion of how many jobs the scheme will destroy or how it will affect industries or regions, or even whether it is the most cost-effective option for Australia to reduce CO2 emissions. What will the cost be in the next 20 years in lost competitiveness and lost jobs? It hardly comes as a surprise that most businesses have absolutely no idea what is in the pipeline for them when the legislation is introduced. We are seeing that in the communications we are receiving from so many people. They are imploring us to seek clarification on this. As we know, the devil will be in the regulations. So we must ensure that the framework for this is the most comprehensive and thorough one possible. A KPMG poll showed that more than three in 10 businesses say they have no knowledge of the key elements of the government’s scheme. They have expressed concerns about the direct cost of the scheme on their businesses, how they will be able to absorb those costs and the way in which the scheme will impact on their ability to retain their workforce. The only interesting insight we have received from the Treasury modelling to date is one that the Rudd Labor government surely—